The problem with commission-based advice
In commercial property, almost all advice is paid for by the transaction. Selling agents earn a percentage of the sale price — typically between 1% and 2.5% — and collect that fee only if and when a sale occurs. This creates a structural incentive that shapes every piece of advice the selling agent gives: recommending acceptance of a lower offer might cost them $15,000 in commission. Recommending that you hold out for a better price might cost them the deal entirely.
Buyers who engage commission-based buyers agents face the mirror problem: an agent who earns more when you pay more is structurally incentivised to close the deal — and to close it quickly, at the highest price the market will bear, because that maximises their fee. An agent paid on commission who tells you to walk away from a deal is acting against their own financial interest. Some will do it anyway. The structure works against you regardless.
What a fixed-fee mandate changes
A fixed-fee advisory mandate restructures the entire economic relationship. The fee is agreed upfront, disclosed fully, and does not change based on whether a transaction occurs or at what price it occurs. The advisor's income is not contingent on closing. The advice they give is therefore not constrained by the fear of losing a fee.
This matters most at the critical decision points in an acquisition process:
- When due diligence reveals a material issue that should change the price — a commission-based agent is incentivised to minimise it; a fixed-fee advisor can price it accurately
- When the right advice is to walk away — a commission-based agent loses their fee; a fixed-fee advisor has already earned theirs
- When market conditions suggest waiting rather than transacting — a commission-based agent has no interest in patience; a fixed-fee advisor's interest is aligned with your long-term outcome
The key principle
A fixed-fee mandate means the advisor's interest and yours are aligned. The advice your acquisition deserves — whether that means proceeding, renegotiating, or walking away — is the advice you receive. Without exception.
What a fixed-fee mandate includes
At Keiga Property, the fixed-fee advisory mandate covers the full acquisition journey:
Initial brief and investment criteria
Understanding your investment objectives, risk tolerance, target asset class, yield requirements, and exit strategy. The brief determines what constitutes a suitable acquisition — and what doesn't, regardless of how it's presented.
Market search and deal sourcing
Active search across both listed and off-market deal flow in your target market. Keith Garrash's relationships across the Illawarra, Southern Highlands, and broader NSW provide access to opportunities that public listing portals do not.
Property assessment and shortlisting
Every candidate property is assessed against your brief before consuming your due diligence budget. Zoning, lease structure, building condition, covenant strength, return profile — all assessed and reported before you see the property.
Negotiation across all variables
Price is one variable. Settlement period, deposit structure, make-good conditions, lease commencement, rent abatements, and warranty packages all affect your effective acquisition cost and risk. The fixed-fee mandate covers negotiation across all of them.
Due diligence coordination
Coordinating your legal, building, environmental, and financial due diligence. Identifying what each finding means for price, risk, or the decision to proceed — not just reporting back what the specialists have said.
Post-acquisition support
For ongoing asset management mandates, the same fee structure applies. Lease strategy, rent reviews, tenant negotiations, and eventual divestment planning — all on a fixed-fee basis that aligns incentives with the quality of the advice, not the volume of transactions.
Is a fixed-fee mandate more expensive?
The simple answer is: it depends what you compare it to. A commission-based buyers agent on a 1.5% fee for a $2M acquisition earns $30,000. A fixed-fee mandate for the same acquisition might be $15,000 to $22,000 — potentially cheaper on a headline basis, and structurally better aligned regardless of the comparison.
The more relevant question is what mistakes a well-structured advisory mandate prevents. A single acquisition error on a $2M commercial asset — overpaying by 5%, missing a material building defect, or acquiring a tenant in undisclosed financial distress — costs more than the advisory fee many times over. The fixed-fee model is not just about the fee structure; it is about the quality of advice that fee structure enables.
How to confirm a fixed-fee mandate is genuine
Not all advisors who claim to operate on a fixed-fee basis are truly independent. Ask the following:
- Is your fee fixed regardless of sale price and regardless of whether a transaction occurs?
- Do you have any referral arrangements with selling agents, developers, or mortgage brokers that pay you if I transact?
- Would you be willing to put this in writing?
- Can you provide references from clients where you advised them not to proceed with an acquisition?
A genuinely independent, fixed-fee advisor will answer all four questions without hesitation. Any equivocation is informative.
Speak to an independent commercial property advisor
Keith Garrash provides fixed-fee advisory for investors, asset managers and vendors across NSW.
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